A world where economic diversification is often seen as the path to financial stability, Lebanon stands out as a nation that has primarily relied on non-agricultural sectors for its economic sustenance. Despite its rich agricultural potential, the country has chosen to prioritize other industries. As Lebanon grapples with a severe economic crisis, it’s crucial to examine the consequences of this strategy and consider whether a renewed focus on agriculture could offer a more resilient path forward.
The main problem Lebanon is currently facing!
Lebanon is currently not placing sufficient emphasis on the agriculture and aquaculture sectors as potential revenue sources.
This neglect comes at a time of economic hardship, marked by a consistent decline in GDP over the years.
Problem Evidence:
Despite the presence of fertile land for agriculture and planting, there is a notable absence of qualified and active employees in this sector, as evidenced by the consistent decline in the percentage of the workforce engaged in agriculture over the years. (the percentage decreases from 5.3%in 2000 to 3.8% in 2021 low percentage of the total employment)
the contributions of forestry and aquaculture to the GDP have been on a continuous decline. (The percentage decreased from 6.3% in 2000 to 1.4% in 2021, indicating a relatively low contribution)
Lebanon’s GDP growth has been consistently decreasing over the years, reaching a troubling -7% in 2021.
Potential solutions
Placing greater emphasis on the agriculture and aquaculture sectors by providing support to local farmers and expanding cultivation areas to meet domestic demands while also generating surplus for export.
Additionally, increasing the number of professionals in this field can be achieved by encouraging universities to prioritize agriculture-related majors and motivating students to pursue studies in this area.
This will result in:
Increased revenue generation and improvements in Lebanon’s GDP after expanding cultivation areas and supporting the agriculture and aquaculture sectors.
Real life success story:
In the summer of 2023, two Lebanese citizens seized the opportunity to cultivate a green, organic farm in the fertile lands of southern Lebanon. Taking advantage of the region’s fertile soil, expansive agricultural land, and favorable weather conditions, they cultivated a variety of fruits and vegetables.
With an initial investment of $1,500, they managed to yield a net profit of $5,000 in just four months. This success story highlights the untapped potential of agriculture and organic farming in Lebanon.
The successful cultivation they were able to get!!!
This solution is validated by the real case example presented at the beginning:
Based on the real-life example, if Lebanon gave more importance to the agriculture sector, this would lead to an increase in domestic production. This, in turn, could serve as a partial solution to the economic and financial crisis the country is facing. Moreover, it would also create more employment opportunities for Lebanese citizens, thereby contributing to a more sustainable and diversified economy. Emphasizing the agriculture sector can play a vital role in bolstering the nation’s economic stability and reducing its reliance on other sectors.
finally, emphasizing agriculture in Lebanon as a means of economic revitalization directly supports SDG 8’s objectives by creating decent work, fostering sustainable economic growth, promoting economic diversification, and facilitating skills development in the agricultural sector.
Contributors: Amin Ghobar, Basilio Diaz, Daniel Raidan, Sally Harb, Stephany Said, and Wissam Malaeb.
Wheat Supply and Food Insecurity in Lebanon
A principal element to boost food security in developing countries is matching the demand for wheat as it is one of the world’s most crucial staple crops. Lebanon, with almost 46% of its households being food insecure, imports around 80% of its food needs and is highly dependent on soft wheat to make Arabic flatbread.
Due to the crippling economic crisis in Lebanon, the diminishing foreign reserves to subsidize wheat imports, the Beirut Port Blast that led to the destruction of the grain silos, and the Russian invasion of Ukraine that had an effect on the supply chain and the wheat prices, Lebanon has been struggling with a negative wheat supply shock.
Lebanon’s Current Situation and the Effects on Wheat Resources and Supplies
The country is facing one of the most devastating economic crises globally since the mid-19th century. The Lebanese currency’s more than 90% value loss against the US Dollar, the inflation rate that exceeded 200%, and the grain reserves lost after the destruction of the Beirut Port – that stored around 85% of the country’s cereals with a maximum capacity of 120,000 metric tons of grain – contributed to the problem at hand. Additionally, Russia and Ukraine supply Lebanon with 70% – 80% of its wheat demand. After the invasion, wheat prices increased drastically and Lebanon, a bankrupt country, was unable to fight in the bidding war.
Moreover, the smuggling of subsidized flour and wheat to the Syrian market and the need to fulfill the nutritious needs of the 1.3 million Syrian refugees on the Lebanese grounds made the food security response an immediate priority.
In terms of Lebanon’s agricultural nature, the country relies on the import of wheat because available land that is viable for farming is not enough to meet the country’s demands and make Lebanon self-sufficient. The consumption demand in Lebanon is topped at 450,000 metric tons, and local wheat production only produces around 10-15% of such demand.
Lebanon needs to start implementing short-term and long-term fixes as the citizens are grappling to afford the increasing prices of bread in a country with a limited number of reserves.
Therefore, we came up with solutions that are divided into two levels of fixes
Short-term Fixes
Pursue avenues to continue subsidizing the price of bread. An example of that would be the “Lebanon Wheat Emergency Response Project” where a $150 million loan from the World Bank was taken that will be used in funding the imports for approximately six to nine months.
Long-term Fixes
Support farmers and develop irrigation programs to help increase local production of the wheat market up until it makes up 50% of Lebanon’s total supply. However, Lebanon can only have a 10% to 15% increase every year according to a study done by the Ministry of Agriculture. This means that it could take 5 to 6 years to reach the goal stated above.
In addition to that, rebuilding Lebanon’s national grain reserve by reconstructing the Beirut port silos and building two new storage silos nearby is another solution. This would cost $100 million and would create six months’ worth of reserves at any given time. Many countries have shown interest in helping Lebanon build those.
Finally, turning to the Ministry of Agriculture’s large and rent-free warehouses in Beqaa should be considered, as the government has been relying on private mills for storage which keeps storage levels on a day-to-day basis and paves the way for black markets. These warehouses only need some maintenance and would be ready for use.
Lebanon is suffering from an economical and financial crisis since 2019. The world bank has classified this crisis as one of the worst 3 crises since mid-nineteenth century. One main reason behind this crisis is the high external debt and its services which have led eventually to a great negative impact on Lebanon’s GDP. One way to control the increase of this debt is working on the development of the agricultural sector.
Problem:
The external dept as well as its services have increased dramatically over years. This increase was highly sharp between the years 2019 and 2020. At the same time, this high increase in the debt was associated with a decrease in GDP growth, specifically between the years 2016 and 2020.
Solution:
The contribution of agriculture in the GDP of Lebanon was decreasing over years. So, supporting the agricultural sector would be one of the solutions that can help freezing the increase in debt. In fact, Lebanon has the required elements to do that, i.e., a cultivatable land and water resources. According to the World Bank collection of development indicators, Lebanon has 64.32% of its land cultivatable.
Supporting the agricultural sector means that the government is requested to work on a plan that can improve the agricultural sector. This is important as a development in the agricultural sector would be reflected as an increase in the agricultural production. Therefore, this will lead to a decrease in the imports and an increase in the exports of agricultural products. Finally, all of this would cause a higher contribution of agriculture in GDP and a decrease in borrowing and debt levels.
This proposed solution has been adopted by many other countries to support their economy. According to the World Bank, agriculture has accounted for more than 25% of GDP in developing countries in the year 2018.
Findings:
Developing agricultural sector is essential for the development of the Lebanese economy.
Improving the agricultural sector will help Lebanon in getting out of the economic and financial crisis.
Recommendation:
The government should construct and implement a plan that can enhance the agricultural sector in Lebanon.
In this Dashboard, we can see how the area harvested with tomatoes in Lebanon didn’t change too much throughout the years, while at the same time the quantity produced has increased a lot, so this show us how the new agriculture methods with the pesticides used have affected a lot the production quantity with keeping the same area harvested. But, does this huge increase has negative effects on us? And what are the circumstances of this on humans?
Data used is from Open Data Lebanon: https://www.opendatalebanon.org/job/tomatoes-supply/
